WEBVTT - Ward: I Don't Scare Easily

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<v Speaker 1>This is Bloomberg surveillance. No matter what happens the US dollar,

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<v Speaker 1>will you need to strengthen, whether the FED hikes in

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<v Speaker 1>June or week December. The US economy is in very

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<v Speaker 1>good shape right now, better shape than I have been

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<v Speaker 1>from US a decade. We're washing around, mocking time before

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<v Speaker 1>the next leg higher in the US dollar. I'm just

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<v Speaker 1>not completely comfortable in my mind with whether it's led

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<v Speaker 1>by this risk aversion or this FED tip. Bloomberg surveillance

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<v Speaker 1>your link to the world of economics, finance, and investment

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<v Speaker 1>on Bloomberg Radio. Good morning at seven am on Wall

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<v Speaker 1>Street noon in London. In the US, we will be

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<v Speaker 1>talking about adding jobs. In the UK, Jamie Diamond is

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<v Speaker 1>talking about cutting them. The jp Morgan CEO goes to

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<v Speaker 1>England today. He warning warns the Brits Brexit Mike force

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<v Speaker 1>JPMorgan to cut back some of their sixteen thousand employees

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<v Speaker 1>there in. The pound is lower this morning. By the way,

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<v Speaker 1>stocks though generally higher around the world, except here in

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<v Speaker 1>the U S where they are flat ahead of the

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<v Speaker 1>ABS report eight thirty Wall Street Time. US futures right now,

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<v Speaker 1>as I mentioned, SMP features literally flat down futures up

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<v Speaker 1>eight points. That a minuscule percentage increase, and ASDAK features

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<v Speaker 1>are down four uh that's about a tenth of a percent.

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<v Speaker 1>In Europe, more conviction, the stock six hundred up by

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<v Speaker 1>two points, six tenths of eight percent, the foots he's

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<v Speaker 1>up fifty eight nine tenths, and the docks in Germany

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<v Speaker 1>sixty one points higher six tenths of a percent. Here's

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<v Speaker 1>what you need to know about the jobs report. It

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<v Speaker 1>will be distorted, perhaps badly by the Verizon strike, so

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<v Speaker 1>traders and the Fed will have to do some mental adjustments.

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<v Speaker 1>A hundred and sixty thousand is the consensus forecast. Jim

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<v Speaker 1>Buggle of FTN told us yesterday on the show. The

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<v Speaker 1>bond market already has done the adjustments. He's not expecting

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<v Speaker 1>big moves unless there's a big surprise. Right now. Through

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<v Speaker 1>your note, you'll going for eighty nine basis points the

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<v Speaker 1>five year one point three five percent. In your tenure

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<v Speaker 1>note you'll comes in at one point eight. All those

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<v Speaker 1>a little bit lower than they have been the last

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<v Speaker 1>couple of days. Oil not a lot of movement, but

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<v Speaker 1>brent over fifty dollars fifty dollars and one cent right now,

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<v Speaker 1>West Texas ten. It's job's day. A lot going on.

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<v Speaker 1>Let's dive right in. Howard Board is chief investment Officer

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<v Speaker 1>at gam Colle, which means he's in charge of climbing

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<v Speaker 1>the wall of worry out there this month. Not only

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<v Speaker 1>jobs today, Janet Yelling on Monday, the Fed in general.

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<v Speaker 1>She has Humphrey Hawkins testimony in a week or show

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<v Speaker 1>Donald Trump. I mean, there are so many things that

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<v Speaker 1>could go wrong. Let me start by asking you, what's

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<v Speaker 1>the blackest swan out there? What scares you the most? Well,

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<v Speaker 1>I don't scare easily, uh, Mike, And I guess, um,

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<v Speaker 1>I don't think. I don't put a high probability on this.

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<v Speaker 1>But right now, when I look at things like the

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<v Speaker 1>global p m I, I see a number that I

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<v Speaker 1>would like to think is trending higher, and actually it

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<v Speaker 1>seems to be trending lower. The global pm I for

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<v Speaker 1>manufacturing right around the fifty mark um not going the

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<v Speaker 1>way i'd like. So I don't think there is a

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<v Speaker 1>recession on the near term horizon, and I don't want

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<v Speaker 1>to encourage that thought. But in terms of a black

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<v Speaker 1>black swan, to me, if these p m I s

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<v Speaker 1>don't get in gear and start accelerating to the up side.

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<v Speaker 1>Then we have to start entering we start we have

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<v Speaker 1>to start talking at least about the possibility of a recession,

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<v Speaker 1>although I do think that's premature at this point. Well,

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<v Speaker 1>the p M I S would be the symptom. What

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<v Speaker 1>what's the cause of of this? Well, you've had the

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<v Speaker 1>problems with the strong dollar, which should be hopefully mostly

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<v Speaker 1>behind us. Now that's the good news. We've had the

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<v Speaker 1>huge pullback in the energy industry. Again, a lot of

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<v Speaker 1>the pullback should be behind us. Also good news. Other

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<v Speaker 1>than that, you know, we've had a tremendous regulatory burden

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<v Speaker 1>UH increase in recent years, and I think that has

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<v Speaker 1>hurt UH company's ability and willingness to invest. We have

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<v Speaker 1>a corporate tax issue in the United States, which makes

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<v Speaker 1>us somewhat uncompetitive and leads to companies hoarding cash overseas UM.

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<v Speaker 1>So I think we need to work on corporate taxes.

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<v Speaker 1>I think we need to work on the regulatory burden

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<v Speaker 1>that's being heaped on America. I think Obamacare has been

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<v Speaker 1>a bit of a problem for growth as well. UH.

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<v Speaker 1>The average I shouldn't say the average, but more than

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<v Speaker 1>fifty of us households now have a healthcare deductible of

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<v Speaker 1>a thousand dollars or more, and ten years ago very

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<v Speaker 1>few households had that. So people are paying more for healthcare,

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<v Speaker 1>paying more out of pocket, and are so about ten

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<v Speaker 1>years ago, uh, fewer than ten percent of households had

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<v Speaker 1>a one thousand dollar deductible on their medical premium. Now

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<v Speaker 1>it's over half the country and so um, that's that's

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<v Speaker 1>how we love to have you on. That's that's really

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<v Speaker 1>that's one of those little factoids that I don't think.

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<v Speaker 1>I'm not you know, you know, I'm all for the

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<v Speaker 1>goals of of of Obamacare, but it is expensive and

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<v Speaker 1>has not lived up to the promises on spending reductions,

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<v Speaker 1>and especially for individual families. I would know Tom that

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<v Speaker 1>even Hillary Clinton in her speeches last couple days have

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<v Speaker 1>been talking about fixes to Albamacare. Yeah, that would bring

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<v Speaker 1>the costs terrific perspective. Good morning everyone, Mike, what an

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<v Speaker 1>extraordinary morning. I mean, going eight ten different ways. You

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<v Speaker 1>mentioned Mr Diamond over in England and Job's day and

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<v Speaker 1>the rest of it. Uh, futures flat. As Michael mentioned,

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<v Speaker 1>I guess I'd watch Yen right now as well. Bloomberg

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<v Speaker 1>surveillance brought you by Investco. This job's day. If you

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<v Speaker 1>considered all your investment alternatives, nontraditional asset classes and strategies

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<v Speaker 1>may help you achieve your goals. Find out more investco

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<v Speaker 1>dot com slash alternatives Mike notice the headline out a Valiant.

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<v Speaker 1>I don't think it's a big deal. It isn't really Valiant.

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<v Speaker 1>It's odd filed their ten Q and they they have

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<v Speaker 1>bond covenants that if they don't file, they're in default.

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<v Speaker 1>Thereof uh, and they have gotten another notice that they

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<v Speaker 1>are in default, but everybody knew they were in default.

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<v Speaker 1>They have sixty days from the receipt of this notice

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<v Speaker 1>to file the ten que and they have said they

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<v Speaker 1>will file it on or before June tenth. So next

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<v Speaker 1>week is the week to watch hard Lord. What is

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<v Speaker 1>your enthusiasm for equities right now? Is a general statement?

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<v Speaker 1>Are you waking up saying this is a terrific set

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<v Speaker 1>of worries? I gotta be on board. I want to

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<v Speaker 1>participate with enthusiasm. Are you hedged? Are you building cash

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<v Speaker 1>and no time? Uh? No, hedges relatively enthusiastic. I would

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<v Speaker 1>say that one of the one of the interesting things

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<v Speaker 1>that I look at is sentiment. Sentiment is extremely bearish

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<v Speaker 1>right now, if we can look at that in a

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<v Speaker 1>couple of different ways. The AII Investor Poll, the percentage

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<v Speaker 1>of investors that are bullish is about seventeen percent. That's

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<v Speaker 1>the lowest since two thousand and five. And I'd also

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<v Speaker 1>point out that, uh, year to date, we've had seventy

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<v Speaker 1>one billion dollars withdrawn from US equity funds. Uh. You know,

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<v Speaker 1>here in the US that number is already as big

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<v Speaker 1>as all of the redemptions in two thousand and eight,

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<v Speaker 1>and so uh and and and and globally the number

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<v Speaker 1>exceeds a hundred billion dollars. So people have been selling stocks,

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<v Speaker 1>not buying stocks, and I think been have been overly

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<v Speaker 1>pessimistic about the rest of this year. Brilliant. Do you

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<v Speaker 1>assume dividend growth is a yield alternative? How do you

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<v Speaker 1>handle that tough, almost philosophical question. Well, you know, we've

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<v Speaker 1>seen the last fifteen years, the SMP five hundred has

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<v Speaker 1>UH provided a total return of closer to six percent

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<v Speaker 1>than its historical ten And part of that has to

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<v Speaker 1>do from the starting point of a very high valuation.

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<v Speaker 1>Part of it all has also has to do with

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<v Speaker 1>the so called new new normal of lower GDP growth

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<v Speaker 1>because ultimately equity returns are somewhat uh hostage to long

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<v Speaker 1>term nominal GDP UH growth rates, and so the dividend

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<v Speaker 1>growth in a lower return environment, the yield and the

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<v Speaker 1>growth of the dividend becomes a bigger component of your

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<v Speaker 1>total return. And the historical dividend growth of about five

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<v Speaker 1>percent may not be quite that high going forward, but

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<v Speaker 1>UH three to four percent growth on a starting dividend

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<v Speaker 1>yield of a of around two percent UH in this

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<v Speaker 1>day and age is an important part of your return

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<v Speaker 1>and uh and and we'll be going forward. Do you

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<v Speaker 1>want to make it more important given the environment you're describing,

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<v Speaker 1>or you're not getting defensive yet? Well, I don't think

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<v Speaker 1>you want to be too defensive, both because defensive stocks

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<v Speaker 1>are pretty highly priced relative to the less defensive group UM,

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<v Speaker 1>and also because the economic fundamentals should be improving over

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<v Speaker 1>the balance of this year, which should lead to more

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<v Speaker 1>of a risk on environment, which should tend to favor

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<v Speaker 1>the less defensive stocks. In fact, UH, so far this year,

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<v Speaker 1>it may not be intuitive, but the less defensive parts

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<v Speaker 1>of the market, the energy names, for example, have been

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<v Speaker 1>the strongest underlying groups. Uh, within somewhere buying energy yet Well, Uh,

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<v Speaker 1>we're not big energy investors. On my side of the firm,

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<v Speaker 1>where we're growth investors. We have a small position, and energy,

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<v Speaker 1>which we haven't touched, is an energy by definition growth

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<v Speaker 1>at this point because all the value has been wiped out. Well,

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<v Speaker 1>that's that's a that's a fair point. Uh. So I

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<v Speaker 1>would not be chasing after energy stocks at this point.

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<v Speaker 1>They've had a pretty significant recovery very quickly. Or I

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<v Speaker 1>love when you're run because I looked for things on

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<v Speaker 1>the Bloomberg that I haven't looked at in ages. I

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<v Speaker 1>have no idea of the Johnson and john Should leg

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<v Speaker 1>up that we've seen in price over the last couple

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<v Speaker 1>of months, I mean the last say ten months. You

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<v Speaker 1>mentioned the Affordable Care Act. Is that an opportunity in

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<v Speaker 1>health stocks with all the mystery and worry about it? Well, Tom, Uh,

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<v Speaker 1>it has been good for the healthcare group. But we're

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<v Speaker 1>an election season now for a presidential campaign, and you

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<v Speaker 1>have both of these candidates talking about making uh, getting

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<v Speaker 1>more price concessions from, for example, the big farmer companies

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<v Speaker 1>like jane Ja. So I would be a little bit

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<v Speaker 1>careful there. And again, Uh, j J is a fabulous company.

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<v Speaker 1>Jane J is a company with four to five organic growth. Uh,

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<v Speaker 1>and you're paying a pretty stiff multiple for that today.

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<v Speaker 1>You know, I probably wouldn't be out to load up

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<v Speaker 1>on it. Let's come back with Howard Ward this morning.

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<v Speaker 1>All right, we're gonna check out with Michael Byr now

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<v Speaker 1>and get the latest world in national headlines. Mine, Tom,

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<v Speaker 1>thank you very much. A group of protesters attack Donald

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<v Speaker 1>Trump's report orders who were leaving the candidates rally in

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<v Speaker 1>San Jose, California, last night. A dozen or more people

0:11:06.559 --> 0:11:09.520
<v Speaker 1>were punched. At least one person was pelted with an

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<v Speaker 1>egg and Trump hats grabbed from supporters. They were set

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<v Speaker 1>on fire on the ground. Police took four people into custody.

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<v Speaker 1>The search continues for four missing soldiers after their carrier

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<v Speaker 1>overturned and the rain swollen creek at Fort Hood, Texas.

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<v Speaker 1>Five other soldiers were killed. A Japanese boy abandoned in

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<v Speaker 1>the forest by his parents has been found safe in

0:11:30.080 --> 0:11:32.880
<v Speaker 1>the military hunt in a training area. Officials say the

0:11:32.880 --> 0:11:35.960
<v Speaker 1>boy appeared worn out, but it was okay. His parents

0:11:36.000 --> 0:11:38.679
<v Speaker 1>trying to teach him a lesson for misbehaving made him

0:11:38.720 --> 0:11:41.080
<v Speaker 1>get out of the car last Saturday. They couldn't find

0:11:41.120 --> 0:11:44.520
<v Speaker 1>him when they returned several minutes later. Global News twenty

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<v Speaker 1>four hours a day, powered by our journalists. I'm Michael

0:11:48.360 --> 0:11:51.160
<v Speaker 1>barr To Michael barn Thanks so much this job, say

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<v Speaker 1>Alan Krueger, Jim Glass when and Bill Gross will be

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<v Speaker 1>with us right now. Howard Ward of Gamco, Michael mckaye

0:11:58.440 --> 0:12:07.120
<v Speaker 1>and Tom King stay with us. Bloomberg Surveillance Bloomberg Surveillance

0:12:07.160 --> 0:12:10.240
<v Speaker 1>brought to by National Realty Returns on Cash and rented

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<v Speaker 1>real Estate. Find them at n r I, a dot

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<v Speaker 1>net broadcasting live to New York, Bloomberg eleventh to Washington,

0:12:28.679 --> 0:12:33.640
<v Speaker 1>d C. Bloomberg to Boston, Bloomberg twelve hounds to San Francisco,

0:12:33.800 --> 0:12:37.920
<v Speaker 1>Bloomberg to the country. Sees at JAMN General one ninety

0:12:38.160 --> 0:12:41.679
<v Speaker 1>and around the globe the Bloomberg Radio Plus Appen Bloomberg

0:12:41.679 --> 0:12:46.280
<v Speaker 1>dot Com. This is Bloomberg Surveillance. Good morning, seven thirty.

0:12:46.280 --> 0:12:49.720
<v Speaker 1>On jobs today, I'm Michael McKee along with Tom Keene.

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<v Speaker 1>Outside of jobs, some news that people are watching. Tom

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<v Speaker 1>Barracks Colony Capitol going to combine with north Star Realty

0:12:56.679 --> 0:13:00.440
<v Speaker 1>Finance and north Star Asset Management Group. All Star Deal

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<v Speaker 1>forms a real estate investment trust fifty eight billion under management.

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<v Speaker 1>Mentioned this earlier. JP Morgan Chase CEO Jamie Diamond wades

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<v Speaker 1>into the Brexit debate, warning in England today the investment

0:13:10.800 --> 0:13:13.000
<v Speaker 1>bank may have to cut jobs in the UK if

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<v Speaker 1>the country decides to exit the European Union. The bank

0:13:15.600 --> 0:13:19.720
<v Speaker 1>has more than sixteen thousand employees. They're being capital pag

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<v Speaker 1>Asia Capital evaluating bids for Takata, the Japanese airbank bag

0:13:23.880 --> 0:13:27.200
<v Speaker 1>supplier behind that record safety recall. That's according to people

0:13:27.200 --> 0:13:30.440
<v Speaker 1>familiar with the matter. And Delta and United Continental are

0:13:30.480 --> 0:13:35.400
<v Speaker 1>weighing bids for Avianca, Columbia's state owned airline, exploring strategic options,

0:13:35.440 --> 0:13:39.280
<v Speaker 1>they say, including a full or partial sale. Let's chok

0:13:39.280 --> 0:13:41.640
<v Speaker 1>out with Michael Barr now and get the latest world

0:13:41.760 --> 0:13:44.400
<v Speaker 1>and national headlines by Mike, Thank you very much. The

0:13:44.440 --> 0:13:47.720
<v Speaker 1>search continues for four soldiers who are missing after their

0:13:47.840 --> 0:13:52.079
<v Speaker 1>troop carrier overturned in a rain swollen creek at four Wood, Texas.

0:13:52.360 --> 0:13:56.160
<v Speaker 1>Five other soldiers were killed. Defense Secretary Ash Carter. We're

0:13:56.160 --> 0:13:59.240
<v Speaker 1>going to make sure that we learned lessons that we

0:13:59.400 --> 0:14:04.400
<v Speaker 1>can from the investigations we conduct after these incidents and

0:14:04.800 --> 0:14:07.720
<v Speaker 1>that we take actions in the future to prevent such

0:14:08.120 --> 0:14:11.840
<v Speaker 1>accidents and keep our people safe. Near Nashville, Tennessee, a

0:14:11.880 --> 0:14:14.880
<v Speaker 1>pilot was killed when his Blue Angels fighter jet crashed.

0:14:15.200 --> 0:14:18.280
<v Speaker 1>President Obama used his final commencement address to a US

0:14:18.360 --> 0:14:21.520
<v Speaker 1>military academy to urge Air Force cadets to find the

0:14:21.600 --> 0:14:25.400
<v Speaker 1>right balance between force and diplomacy. The presidential the Air

0:14:25.440 --> 0:14:29.720
<v Speaker 1>Force Academy's class of that they must not allow the

0:14:29.840 --> 0:14:32.960
<v Speaker 1>US to turn away from the world. At least nineteen

0:14:33.040 --> 0:14:38.080
<v Speaker 1>journalists were attacked while covering food protests in downtown Caracas.

0:14:38.200 --> 0:14:41.680
<v Speaker 1>That's according to a non governmental organization that monitors freedom

0:14:41.720 --> 0:14:45.720
<v Speaker 1>of expression in Venezuela's capital. The assaults included robberies allegedly

0:14:45.760 --> 0:14:49.560
<v Speaker 1>by members of the National Guard and armed civilians. Global

0:14:49.560 --> 0:14:52.160
<v Speaker 1>News twenty four Hours a Day. I'm Michael bar Mike,

0:14:54.120 --> 0:14:58.960
<v Speaker 1>Thank you, Michael. Time now for the Bloomberg innbcs A

0:14:59.040 --> 0:15:03.160
<v Speaker 1>Landover participan the sports Update. Here's jes alright, Mike. A

0:15:03.240 --> 0:15:05.480
<v Speaker 1>surprise in Game one of the NBA Finals, not Golden

0:15:05.480 --> 0:15:07.720
<v Speaker 1>State winning, but the way the Warriors won, getting more

0:15:07.760 --> 0:15:11.040
<v Speaker 1>points from their backup guards than they're much more heralded

0:15:11.120 --> 0:15:14.480
<v Speaker 1>starter Steph Curry and Clay Thompson together scored twenty points

0:15:14.480 --> 0:15:17.680
<v Speaker 1>and Sean Livingston had that by himself. Leanro Barbosa added

0:15:17.680 --> 0:15:20.760
<v Speaker 1>eleven off the bench. Those two shot to combine thirteen

0:15:20.880 --> 0:15:23.960
<v Speaker 1>for fifteen, and the Warriors won Game one one oh

0:15:24.000 --> 0:15:26.360
<v Speaker 1>four to eighty nine. The Calves came from fourteen down

0:15:26.360 --> 0:15:28.240
<v Speaker 1>to briefly lead in the third quarter, but the Warriors

0:15:28.280 --> 0:15:31.640
<v Speaker 1>pulled away from there. Bench scoring was forty five to

0:15:31.840 --> 0:15:34.560
<v Speaker 1>ten for Golden State came to his Sunday again in

0:15:34.560 --> 0:15:36.200
<v Speaker 1>open took a while for the Yankees, didn't get a

0:15:36.240 --> 0:15:38.440
<v Speaker 1>hit until the sixth inning, but finally some runs four

0:15:38.480 --> 0:15:41.120
<v Speaker 1>in the seventh. They held on to win the rainout

0:15:41.200 --> 0:15:43.680
<v Speaker 1>makeup in Detroit five to four, Baltimore meat the Red

0:15:43.680 --> 0:15:46.320
<v Speaker 1>Sox twelve to seven as the Oils hit seven on runs.

0:15:46.720 --> 0:15:50.520
<v Speaker 1>Seattle sixteen, San Diego thirteen. The Mariners trail twelve to

0:15:50.640 --> 0:15:53.200
<v Speaker 1>two in the sixth inning and came back to win.

0:15:53.280 --> 0:15:54.960
<v Speaker 1>The Mets were off. They have put David right under

0:15:55.000 --> 0:15:57.600
<v Speaker 1>the disabled dist with that naggy neck injury that they

0:15:57.600 --> 0:16:00.560
<v Speaker 1>say could keep him out for a prolonged period. Serina

0:16:00.640 --> 0:16:03.720
<v Speaker 1>Williams down three one opening set of or semifinal match

0:16:03.720 --> 0:16:07.240
<v Speaker 1>at the French Open with Kiki barton the Bloomberg NBC

0:16:07.280 --> 0:16:10.880
<v Speaker 1>Sports Up. I'm John Stash. Thank you John. They always

0:16:10.920 --> 0:16:13.600
<v Speaker 1>say watched the dollar, and we are watching the dollar

0:16:13.720 --> 0:16:17.880
<v Speaker 1>ahead of the jobs report. It is a scouch stronger,

0:16:17.920 --> 0:16:21.680
<v Speaker 1>shall we say, against most currencies, but um, the end

0:16:21.880 --> 0:16:25.720
<v Speaker 1>is UH is unchanged right now. The year an one

0:16:25.720 --> 0:16:29.920
<v Speaker 1>O eight seven and the pound. Of course, they've got

0:16:29.960 --> 0:16:32.880
<v Speaker 1>their own issues to worry about over in Great Britain

0:16:32.920 --> 0:16:39.200
<v Speaker 1>as they prepare for the Brexit vote. Ahead for us

0:16:39.200 --> 0:16:42.400
<v Speaker 1>here on Bloomberg Surveillance, it's the jobs report coming up.

0:16:42.440 --> 0:16:45.120
<v Speaker 1>We're gonna talk with Alan Krueger and then we'll get

0:16:45.120 --> 0:16:48.440
<v Speaker 1>a preview from James Classman of JP Morgan Chase and

0:16:48.480 --> 0:16:52.920
<v Speaker 1>get reaction from Bill Gross. The market is putting in

0:16:52.960 --> 0:16:55.960
<v Speaker 1>a little bit of a positive tone right now. SMP

0:16:56.040 --> 0:16:58.760
<v Speaker 1>features up by a point, down features up by sixteen.

0:16:58.920 --> 0:17:02.040
<v Speaker 1>We were becalling homed earlier, but we are getting closer

0:17:02.040 --> 0:17:04.600
<v Speaker 1>and closer to the number. An hour from now. We're

0:17:04.600 --> 0:17:06.480
<v Speaker 1>going to check in with Bob Moon now and get

0:17:06.600 --> 0:17:10.520
<v Speaker 1>the Blueberg n j I T STEM Report brought to

0:17:10.560 --> 0:17:13.359
<v Speaker 1>you by New Jersey Institute of Technology investing more than

0:17:13.400 --> 0:17:15.760
<v Speaker 1>a ten million dollars a year and applied research to

0:17:15.800 --> 0:17:18.040
<v Speaker 1>solve problems and improve life. They are more stories of

0:17:18.119 --> 0:17:21.720
<v Speaker 1>innovation dot n J I T dot EU. Bob Michael,

0:17:21.720 --> 0:17:24.879
<v Speaker 1>Good morning. Here's what's making news in science, technology, engineering

0:17:24.920 --> 0:17:28.040
<v Speaker 1>and math. This summer and fall, the Atlantic Ocean could

0:17:28.080 --> 0:17:32.040
<v Speaker 1>become a hurricane testing site of sorts. After decades of warmth.

0:17:32.040 --> 0:17:34.920
<v Speaker 1>There's evidence the Atlantic is cooling and that change could

0:17:35.000 --> 0:17:38.480
<v Speaker 1>mean fewer hurricanes, breaking havoc on coastal communities and economies.

0:17:38.840 --> 0:17:41.680
<v Speaker 1>It's part of a cycle called the Atlantic multi decatal

0:17:41.920 --> 0:17:45.000
<v Speaker 1>oscillation and convinced they stick these terms in just a

0:17:45.080 --> 0:17:47.240
<v Speaker 1>test us, let's call it the A m O for short.

0:17:47.600 --> 0:17:50.120
<v Speaker 1>Not nearly as snappy as El Nino in the Pacific,

0:17:50.160 --> 0:17:52.720
<v Speaker 1>but this could even overshadow that. The theory is that

0:17:52.800 --> 0:17:55.960
<v Speaker 1>the Atlantic cools and warms every twenty to forty years,

0:17:56.320 --> 0:17:59.840
<v Speaker 1>changing the African monsoon and easterly jet stream, air pressure

0:18:00.000 --> 0:18:02.560
<v Speaker 1>over the ocean, and levels of wind shear. All these

0:18:02.600 --> 0:18:05.480
<v Speaker 1>can add or to track from hurricane lifespans. The thing

0:18:05.600 --> 0:18:08.160
<v Speaker 1>is not everyone believes the A m O effects hurricanes

0:18:08.200 --> 0:18:11.480
<v Speaker 1>that way. There are competing hypotheses, and this cycle is

0:18:11.520 --> 0:18:13.680
<v Speaker 1>giving scientists more of the data they need to build

0:18:13.680 --> 0:18:17.200
<v Speaker 1>their knowledge on effects of this phenomenon. Honeywell is warning

0:18:17.200 --> 0:18:21.480
<v Speaker 1>of growing cyber attacks by state sponsored hackers. Cybersecurity provider

0:18:21.520 --> 0:18:25.200
<v Speaker 1>says they're increasingly targeting industrial facilities from oil refineries to

0:18:25.320 --> 0:18:29.320
<v Speaker 1>nuclear power plants with sophisticated attacks aimed at capturing data

0:18:29.359 --> 0:18:32.920
<v Speaker 1>and remotely controlling the sites. Honey will provide cybersecurity for

0:18:33.000 --> 0:18:36.359
<v Speaker 1>more than four hundred industrial sites worldwide. And Walmart is

0:18:36.440 --> 0:18:39.159
<v Speaker 1>linking up with Uber and Lift, using their services to

0:18:39.280 --> 0:18:43.520
<v Speaker 1>enlist drivers in grocery deliveries. The world's biggest retailer is

0:18:43.560 --> 0:18:46.480
<v Speaker 1>aiming to match the convenience of services offered by Amazon

0:18:46.520 --> 0:18:49.399
<v Speaker 1>dot Com and other e commerce companies. That's this morning's

0:18:49.720 --> 0:18:53.280
<v Speaker 1>Bloomberg and j I T Stem Report. Michael Babo, thank

0:18:53.280 --> 0:18:55.840
<v Speaker 1>you very much. That is almost a kind of perfect

0:18:55.880 --> 0:18:59.600
<v Speaker 1>set up for our next guest, Alan Krueger is of course,

0:18:59.680 --> 0:19:02.840
<v Speaker 1>so with Princeton University. It was the former chief economists

0:19:02.840 --> 0:19:04.800
<v Speaker 1>as the Labor Department in the Treasury Department and a

0:19:04.840 --> 0:19:06.560
<v Speaker 1>guy who has done a lot of work on the

0:19:06.640 --> 0:19:11.600
<v Speaker 1>labor market, including this new gig economy. Alan, what's the

0:19:11.640 --> 0:19:16.400
<v Speaker 1>latest on what you've found about the gig economy. I mean,

0:19:17.320 --> 0:19:20.000
<v Speaker 1>they're gonna start delivering groceries in uber and lift cars.

0:19:20.040 --> 0:19:25.560
<v Speaker 1>It's one more set of jobs that in theory goes away. Well, actually,

0:19:25.600 --> 0:19:28.359
<v Speaker 1>that's probably a whole new set of jobs, um, since

0:19:28.400 --> 0:19:31.600
<v Speaker 1>it's not so easy to get your groceries over there now. Um.

0:19:31.760 --> 0:19:33.520
<v Speaker 1>But I think it makes a fair amount of sense

0:19:34.160 --> 0:19:39.600
<v Speaker 1>because the area where we've seen online gig economy the

0:19:39.640 --> 0:19:45.600
<v Speaker 1>most is transportation and food delivery uberscrubhub, and in some

0:19:45.720 --> 0:19:48.840
<v Speaker 1>sense this is a merger of those two. If I

0:19:48.880 --> 0:19:52.240
<v Speaker 1>want to look at the job's report in any particular

0:19:52.280 --> 0:19:55.600
<v Speaker 1>month and see the impact where of the gig economy,

0:19:55.680 --> 0:20:00.040
<v Speaker 1>where would I look? You won't find it up a

0:20:00.119 --> 0:20:03.960
<v Speaker 1>couple of reasons. One, in the establishment survey, the parrels

0:20:03.960 --> 0:20:08.880
<v Speaker 1>to say, ah, only employees are on the payroll are included,

0:20:09.440 --> 0:20:14.480
<v Speaker 1>and the gig workers are overwhelmingly independent contractors, And the

0:20:14.520 --> 0:20:18.560
<v Speaker 1>household survey does a terrible job picking it up. So

0:20:19.720 --> 0:20:24.440
<v Speaker 1>I don't think that these UH workers are being reflected

0:20:24.440 --> 0:20:27.240
<v Speaker 1>in many of our current statistics. But at the same time,

0:20:27.280 --> 0:20:31.359
<v Speaker 1>it's still quite small. Various estimates point that only had

0:20:31.400 --> 0:20:34.280
<v Speaker 1>half a percent of the u S workforce is involved

0:20:34.280 --> 0:20:38.119
<v Speaker 1>in some type of online gig work. Is This is

0:20:38.160 --> 0:20:41.119
<v Speaker 1>something though, that needs to be addressed by the Bureau

0:20:41.080 --> 0:20:45.879
<v Speaker 1>of Labor Statistics, growing enough that it distorts the numbers

0:20:45.920 --> 0:20:50.760
<v Speaker 1>and policymakers don't really know who's doing what. I think

0:20:50.800 --> 0:20:53.159
<v Speaker 1>we need to do a much better job job tracking it.

0:20:53.600 --> 0:20:55.720
<v Speaker 1>At a minimum, we need to do the contingent worker

0:20:55.800 --> 0:20:59.639
<v Speaker 1>survey more frequently. But even the worker survey, which hasn't

0:20:59.680 --> 0:21:03.440
<v Speaker 1>been done since it as of five by the BLS,

0:21:03.680 --> 0:21:06.520
<v Speaker 1>has some problems when it comes to the big economy

0:21:06.600 --> 0:21:09.240
<v Speaker 1>since it focuses on the main job and a lot

0:21:09.240 --> 0:21:11.800
<v Speaker 1>of workers are doing this part time as a secondary.

0:21:13.560 --> 0:21:16.160
<v Speaker 1>Let me bring in Tom here with a question. He

0:21:16.240 --> 0:21:18.959
<v Speaker 1>asked me on the air this morning and I couldn't answer.

0:21:19.280 --> 0:21:20.760
<v Speaker 1>So I'm gonna put it to you, because you're the

0:21:20.800 --> 0:21:25.920
<v Speaker 1>smarter guy here. When you look at the the job

0:21:25.960 --> 0:21:27.960
<v Speaker 1>creation on a month to month basis, over the last

0:21:27.960 --> 0:21:32.159
<v Speaker 1>two years, standard deviation and change has dwindled away to

0:21:32.160 --> 0:21:36.520
<v Speaker 1>almost nothing. It's about one standard deviation per month um.

0:21:37.480 --> 0:21:41.160
<v Speaker 1>Why why have we gotten so incredibly consistent in job creation?

0:21:42.880 --> 0:21:45.680
<v Speaker 1>You know, that's a really good question. Uh. I think

0:21:45.680 --> 0:21:49.160
<v Speaker 1>it looked at g DPS playing something similar. Even though

0:21:49.160 --> 0:21:51.800
<v Speaker 1>there are big fluctuations, they're actually less than they had

0:21:51.840 --> 0:21:54.879
<v Speaker 1>been quarter the quarter, and I think we're seeing to

0:21:55.000 --> 0:21:58.480
<v Speaker 1>some standard continuation of the moderation that existed before the

0:21:58.480 --> 0:22:04.040
<v Speaker 1>Great Recession. Uh. Why that's taking place is not so clear,

0:22:04.119 --> 0:22:06.640
<v Speaker 1>but I think this does look a lot like we

0:22:06.640 --> 0:22:11.120
<v Speaker 1>were seeing, uh for the Great Recession, certainly in terms

0:22:11.200 --> 0:22:16.360
<v Speaker 1>of quarterly GDP fluctuations. Well, does it have implications at

0:22:16.400 --> 0:22:21.640
<v Speaker 1>all for for policy or is it just an interesting factoid? Well,

0:22:21.680 --> 0:22:23.320
<v Speaker 1>I think it makes like a little bit easier for

0:22:23.400 --> 0:22:26.800
<v Speaker 1>policymakers because it makes it a little bit easier to

0:22:26.840 --> 0:22:30.120
<v Speaker 1>read the tea leaves if the leaves are moving around lass.

0:22:30.760 --> 0:22:32.760
<v Speaker 1>At the same time, the revisions to the data are

0:22:32.800 --> 0:22:39.760
<v Speaker 1>still quite large, so um, I think we haven't narrowed

0:22:39.920 --> 0:22:45.800
<v Speaker 1>the sampling variability that comes along with measuring the US economy.

0:22:46.200 --> 0:22:48.320
<v Speaker 1>But the US company itself is being a little bit

0:22:48.359 --> 0:22:50.800
<v Speaker 1>more stable, and I think that's a positive thing for

0:22:51.800 --> 0:22:53.679
<v Speaker 1>for the US. It means that we're growing in a

0:22:53.840 --> 0:22:57.880
<v Speaker 1>steady pace. Krueger is with us. It is jobs day.

0:22:57.880 --> 0:23:01.000
<v Speaker 1>Of course, we have remember tom Ad magazine used having

0:23:01.000 --> 0:23:03.879
<v Speaker 1>its mass dead, the usual gang of idiots. We have

0:23:03.920 --> 0:23:07.560
<v Speaker 1>the usual gang of really smart people joining us today

0:23:07.560 --> 0:23:10.600
<v Speaker 1>coming up, Jim Glassman and then Bill Gross and uh

0:23:10.640 --> 0:23:13.800
<v Speaker 1>Scott Mather. So you don't want to turn your dial.

0:23:13.880 --> 0:23:21.760
<v Speaker 1>Stay with us here on Blueberg Surveillance Jobs Day. Bloomberg

0:23:21.800 --> 0:23:24.000
<v Speaker 1>Surveillance brought to by Bank of America Merrill Lynch seeing

0:23:24.000 --> 0:23:25.960
<v Speaker 1>what others have seen, but uncovering what others may not.

0:23:26.240 --> 0:23:28.800
<v Speaker 1>Global research that helps you a harness disruption. Go to

0:23:28.800 --> 0:23:31.400
<v Speaker 1>top global research from five years running Merrill Lynch, peerce Fitner,

0:23:31.400 --> 0:23:32.399
<v Speaker 1>and Smith Incorporated